In 1994, Gunderson was outed as gay on the House floor by conservative then-representative Bob Dornan (R-CA) during a debate over federal funding for gay-friendly curricula,[5] making him one of the first openly gay members of Congress and the first openly gay Republican representative.[6] In 1996, Gunderson was the only Republican in Congress to vote against the Defense of Marriage Act,[7][8] and he has been a vocal supporter of gay rights causes since leaving Congress.

Although Gunderson drew opposition from some conservatives for his support of gay rights causes, other conservatives later praised him for his advocacy on behalf of expedited immigration rights for the LaotianHmong, who had been allied with U.S. war efforts during the Vietnam War and later faced persecution under the Communist government of Laos.

In an October 1995 National Review article, Michael Johns, a former Republican White House aide and Heritage Foundation policy analyst, praised Gunderson's efforts in behalf of the Hmong people, quoting Gunderson as telling a Hmong gathering in Wisconsin: "I do not enjoy standing up and saying to my government that you are not telling the truth, but if that is necessary to defend truth and justice, I will do that."[9] Republicans also called several Congressional hearings on alleged persecution of the Hmong in Laos in an apparent attempt to generate further support for their opposition to the Hmong's repatriation to Laos. Led by Gunderson and other Hmong advocates in Congress, the Clinton administration's policy of forced repatriation of the Hmong was ultimately overturned and thousands were granted U.S. immigration rights.